Frequently Asked Questions IL - TaxGarden 

Personal Tax FAQ

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I am a student. Why should I file an Illinois income tax return?
Students are not exempted from tax or there are no special residency provisions for them. However, income, such as certain scholarships or fellowships, that is not taxable under federal income tax law, is also not taxed by Illinois.
I do not think I owe tax, so why should I file a return?
If you are an Illinois resident you must file Form IL-1040 if you were required to file a federal income tax return, or your Illinois base income is greater than your Illinois exemption allowance.
I am a part-year resident. How to file a return?
If you are a part-year resident (you lived in Illinois for part of the year) you must file Form IL-1040 and Schedule NR if you were required to file a federal income tax return, or your Illinois base income from Schedule NR is greater than your Illinois exemption allowance on Schedule NR.
I am a nonresident. How to file a return?
If you are a nonresident you must file Form IL-1040 and Schedule NR if your Illinois base income from Schedule NR is greater than your Illinois exemption allowance on Schedule NR.
I have a refund coming, so why should I file a return?
You must file an Illinois return to claim your refund. A refund can’t be claimed without filing your return.
I work out-of-state when at school. Do I have to report the earning I make to Illinois?
Yes. You are still an Illinois resident, even if you go to school in another state. Likewise, you have to check if you need to file a tax return with the other state as well. If you have to file a return with the other state, you may be eligible for a credit in Illinois on Schedule CR.
Why do I owe Illinois tax when I do not owe any federal tax?
Federal and state tax laws and rates are not the same. There are chances to owe Illinois and receive a refund from the IRS.
Can my guardian claim me as a dependent on their IL return?
Internal Revenue Service must be contacted in this case to determine if they can claim you as a dependent on their tax return. If they claim you as a dependent on their federal return, they will also claim you as a dependent on their Illinois return.
If my parent cannot claim me as a dependent on their return, can I claim myself?
Illinois allows you to claim your own exemption on your state return if you claimed an exemption for yourself on your federal return.
After completing the Illinois tax return I found that I made a mistake. What must be done?
If you owe the state and are filing electronically, you may pay the entire amount or make a partial payment instantly online at the end of your session. Or you may print out your tax form and payment coupon at the end of your session and mail your payment with your return by April 15. But be sure your payment is postmarked by April 15 to avoid penalties and interest.
Owe taxes to the State of Illinois but won’t be able to pay the bill in full by April 15. What to do?
It is always wise to pay as much of the bill as you can by April 15 so that you can reduce the amount of penalty and interest that will be added to the bill. As soon as you receive a bill, call the number on the bill to see what payment options are available.
This is the first year I am filing an Illinois tax return. Can I e-file my return?
Sure, but if you are a first time IL-1040 filer you must have IL identification number or driver’s license number on file with the Illinois Secretary of State to e-file your return. You also can use a professional tax preparer to file your tax return electronically.
What to do if I made an error, forgot something, or need to amend?
If you notice that you made an error or forgot to include income, withholding, or another credit on your original return, you need to file Form IL-1040-X, Amended Individual Income Tax Return.
How to file for IL Extension?
Illinois allows an automatic six-month extension to file your state tax return. You do not have to file any form with Illinois to take advantage of the extension. The extended filing deadline is October 15. If you received an extension of more than six months to file your federal tax return, you are automatically allowed to receive the same extension of time to file your IL state return as well.
The IL state tax extension is an extension of time to file, not to pay. If you owe state tax, you must also make a payment using Form IL-505-I, Automatic Extension Payment for Individuals, by the deadline.
How do I get a copy of my tax return?
If you would like a paper copy of your tax return and any attachment to that return you have to complete Form IL-4506, by requesting fora copy of your Tax Return. There is a $5 charge for each copy of the return, which includes all attachments, and an additional $5 charge if you want the document certified.
You can mail Form IL-4506 with the payment to:
RECORDS MANAGEMENT DIVISION 2-202
ILLINOIS DEPARTMENT OF REVENUE
PO BOX 19014
SPRINGFIELD, IL 62794-9014
What is the sales tax rate in Illinois?
Illinois’ sales tax rate is 6.25 percent on general merchandise and 1 percent on qualifying foods, drugs, and medical appliances. The tax rate may be higher in some areas because some local jurisdictions are allowed to impose their own taxes.
What if I cannot pay the tax that I owe?
If you cannot pay the tax you owe but can file the return on time, file your return by the due date without the payment. By this you will at least escape from being changed with late-filing penalty from being assessed. You will, however, owe a late-payment penalty and interest on any tax you owe after the original due date, even if you have an extension of time to file.
Should I file an income tax return if I live in another state but worked in Illinois?
As a nonresident you are required to file Form IL-1040, Individual Income Tax Return, and Schedule NR if you earned enough taxable income from Illinois sources to have a tax liability (i.e., your Illinois base income from Schedule NR is greater than your Illinois exemption allowance on Schedule NR), or you want a refund of any Illinois Income Tax withheld in error.
If you received wages, salaries, tips, and commissions from Illinois employers of reciprocal states, you need not pay Illinois Income Tax on this income. This is based on reciprocal agreements between Illinois and those states.
What is the penalty for not making estimated tax payments for individual income tax?
A late-payment penalty for underpayment of estimated tax will be levied when there is a requirement to make estimated payments and failed to do so, or failed to pay the required amount by the payment due date. If the Illinois Income Tax exceeds the total tax withheld and credits by more than $500 then it may be required to make estimated payments.
I have lost my refund check, how do I get a new one?
To get a replacement for a lost refund check, you may write the Comptroller's Office at 325 W Adams St, Springfield, IL 62704 with your name, address, Social Security number (SSN), check number, and refund amount for easier identification.
How to amend a return?
Do not file another Form IL-1040 to make changes to a previously filed Form IL-1040. You must file Form IL-1040-X, Amended Individual Income Tax Return, if you made a mistake on your return.
What if you are an Illinois resident and earn wages in another state with income tax rate lower than the IL Income tax rate?
If the other state's income tax rate is lower than the Illinois rate, the taxpayer should complete Form IL-W-4, Employee's Withholding Allowance Certificate, and give it to the employer to have additional tax withheld from the paycheck.
What are the conditions in which penalty and interest are imposed?
  • A late-filing penalty if you do not file a return that can be processed by the extended due date.
  • A late-payment penalty for tax not paid by the original due date of the return.
  • A late-payment penalty for underpayment of estimated tax if you were required to make estimated tax payments and failed to pay the required amount by the payment due dates.
  • A bad check penalty if your remittance is not honored by your financial institution.
  • A cost of collection fee if you do not pay the amount you owe within 30 days of the date printed on any IDOR-2-BILL, Final Notice of Tax Due for Form IL-1040, Individual Income Tax Return, you receive.
  • A frivolous return penalty if you file a return that does not contain information necessary to figure the correct tax or shows a substantially incorrect tax, because you are taking a frivolous position or are trying to delay or interfere with collection of the tax.
  • Interest on unpaid tax from the day after the original due date of your return through the date you pay the tax.
What is the eligibility for Property Tax Credit?
Credit is calculated for the Illinois property taxes paid in the present tax year on your principal residence. Nonresidents of Illinois may not take this credit.
What is the eligibility for the Illinois Earned Income Credit?
In general, if you qualified for a federal Earned Income Credit (EIC), you also qualify for the Illinois Earned Income Credit.
If you filed a joint federal return and you elected to file separate Illinois returns because one spouse is an injured spouse, you may each claim the earned income credit. However, the total federal credit reported on Schedule ICR, Line 10a for both spouses cannot exceed the EIC amount claimed on your joint federal return.
What is the purpose of Schedule M?
Schedule M, Other Additions and Subtractions for Individuals, allows you to figure the total amount of additions you must include on Form IL-1040, Individual Income Tax Return, Line 3 and subtractions you may claim on Form IL-1040, Line 7.
What if I were a nonresident of Illinois for the entire tax year?
If you were a nonresident of Illinois during the entire tax year, you must complete and file Form IL-1040 and Schedule NR if you earned enough taxable income from Illinois sources to have a tax liability.